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ICT Development in Lao P.D.R, 2008

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  • 1. ICT Development in Lao P.D.R: Current Status Xayluxa INSISIENGMAY Director, Radio Spectrum Management Division Department of Telecommunications and the Internet National Authority of Posts and Telecommunications Telephone: 856 21 218897 Email: xayluxa@yahoo.com International Symposium on Communications and Information Technologies 2008 October 21-23, 2008 Vientiane, Lao PDR
  • 2. Contents: I. Introduction II. National Agency responsible for ICTs III. ICT and Development IV. Market Structure and ownership V. Global Trend VI. Telecommunication Sector performance VII. Challenges VIII. Conclusion
  • 3. “If the world is serious about achieving the Millennium Development Goal of halving the number of people living in extreme poverty by the year 2015, ICT must figure prominently in the effort. Everyone – governments, civil society, and private sector businesses – has a vital stake in fostering digital opportunity and putting ICT at the service of development.” Kofi Annan, (Ex) UN Secretary-General Extract from the foreword of the UNCTAD E-Commerce and Development Report
  • 4. I. Introduction
  • 5. Country Profile • Population: 5.6 mill. (2005) (80% live in rural areas) • Area: 236,800 Km2 • Provinces: 17 • Districts: 139 • Poorest district: 47 • GDP: US$ 4.8 bill (2008) • GDP per Capita: US$850 (2008) • ICTs: - Fixed line: 2.14% (2007) - Mobile: 26.35% (2007) - Tele-density: 28.5% (2007) - Internet: 0.12% (2007) - Radio coverage: 80% - TV coverage: 60%
  • 6. Development Vision • “New Economic Mechanism” – in 1986 • In 1990s national economy grew at an average rate of 6.3% • Annual growth during 2000-06 was 6.5% • In 2007 the growth reached 7.5% • The Government’s objective is to maintain the rapid economic growth, meet the MDGs by 2015 and escape from LDC status by 2020 Source: http://www.un.org/ecosoc/docs/pdfs/Lao%20PDR.text.pdf
  • 7. Recent Economic Growth • During the first six months of 2007/2008 FY , the GDP grew at a rate of 7.9% (8% predicted) • Service sector grew by 9.9% (7% predicted) • For the 2008/2009 FY, the government will maintain the macro-economic targets at the same level as in 2007/2008, i.e. GDP shall grow by 8% agriculture 3.4% industry 1.58% services 9.9% Source: Vientiane Times, July 9 2008, p.19
  • 8. Development Vision 2020: Out of LDC status 2015: Achievement of MDGs 2010: Fundamentally eradicate poverty, Stop slash and burn cultivation 2005: Eradicate Poverty by half, Stop opium cultivation Source: http://www.rtm.org.la/General%20RTM.php#RTM9
  • 9. II. National Organization for ICT
  • 10. National Organization for ICT • Authorité Nationale des Postes et des Télécommunications or National Authority of Post and Telecommunication (ANPT) • ANPT created by the PM Decree No.375/PM of 22nd October 2007 and replaced Department of Posts and Telecommunications/MCTPC • ANPT is a organization under the Prime Minister Office, dealing with policy, strategy and its implementation and administrative issues on Post, Telecommunications and ICT in Lao PDR
  • 11. Organization Chart of NAPT Minister to PMO Head of ANPT Deputy Head ANPT Department of Department of Department Department Institute of Administration Planning & of Telecommuni of Posts Posts & Tele Cooperation cations and the communications Internet
  • 12. Policy and regulations • NAPT is responsible for both the policy- making and regulatory function for telecommunications and ICT sectors • Telecommunication Act was passed and entered into force in 2001 • Telecommunication sector policy 2004 • Telecommunication sector policy 2007 (draft)
  • 13. Policy and regulations • Telecommunication market – Government has stake in all the operators – Based on ASEAN Framework Agreement on Services, for value added services the new entry can only take place through a joint venture with Lao service provider or acquisition of existing operators – Under BTA with the US, Lao PDR has made commitments to provide unrestricted market access and full national treatment for the whole range of basic fixed and mobile (on a facilities basis or by resale, through any means of technology) as well as value-added telecommunications services
  • 14. III. ICT and Development
  • 15. ICT’s contribution to GDP • By their very nature, ICTs serve the society in a way no other industry does, firstly as fast growing industry by themselves generating employment and wealth, and secondly as enablers of social and economic activities. • ICTs and Telecom sector account for a significant percentage of the GDP in several developed and developing countries. However difficulty arises in assessing the impact of ICTs in terms of direct and indirect benefits, because differences exist in defining the goods and services covered under the ICT sector. The contribution is normally far more then assessed.
  • 16. Distribution of population and GDP by income group Income Number of GDP per Population, Population Total GDP group economies, capita 2006 %, 2006 %, 2006 2006 USD, 2006 High 57 35 496 1 030 624 15.7% 75.8% Upper- 39 6 514 816 121 12.5% 11.0% middle Lower- 55 2 062 2 295 478 35.0% 9.8% middle Low 52 669 2 408 914 36.8% 3.3% World 203 7 439 6 551 138 100% 100% Source: ITU, Trend in Telecommunication Reform 2007
  • 17. ICT and Development • Well developed ICT infrastructure is the key to rapid economic and social development of a country. • A number of ITU studies over the past several decades have analyzed the relationship between the growth of ICT, particularly telecommunication services, and the economic growth and found that a direct link exists between a country’s telecommunication penetration and the GDP. • According to a study, ICT diffusion accounts for up to 90% of the increase in human development index. • Although, the link does not explain the correlation or cause and effect relation, it does establish its vital importance for accelerating the economic growth.
  • 18. Distribution of major ICTs by income group, 2006 100% 15.50% 90% 34.60% 80% 9.30% 41.90% 53.40% 70% 69.80% 75.83% 60% High 16.70% 38.50% 10.90% Upper-middle 50% Lower-middle Low 11.30% 40% 30% 36.40% 41.40% 7.40% 25.40% 20% 36.70% 11.02% 21.70% 10% 9.81% 12.30% 10.00% 5.80% 1.10% 3.34% 0% Population Fixed lines Mobile Internet users Broadband Total GDP subscribers subscribers Source: ITU, Trend in Telecommunication Reform 2007
  • 19. Asia-Pacific’s share of the global total for various services, 2006 Population 55.50% 2.40% 57.9% Mobile subscribers 37.80% 4.10% 41.9% Fixed lines 43.20% 5.40% 48.6% Internet users 30.60% 9.50% 40.1% Broadband 39.2% 28.30% 10.90% Subscribers Developing Developed Source: ITU, Trend in Telecommunication Reform 2007
  • 20. ICT’s and Socio-economic Development • In individual countries, some measurements of ICT would be included in their respective capital equipment accounts while others might be classified as Information services. Direct impact of ICT in comparable economic terms cannot be measured without a globally accepted definition. Developed nations have reached a consensus on this issue. Developing countries have not. • However, there is no denying the fact that ICTs contribute directly and indirectly to the economy in terms of revenue and employment. Their impact on economy can be measured by their contribution to the GDP. Indirect benefits accrue by the use and application of ICTs in other economic sectors and for social activities by the resulting efficiency and productivity increase.
  • 21. Telecommunications revenue and GDP • Comparative Indicators of Lao PDR and the East Asia/Pacific Region Total Telecommunications Revenue (% of GDP) 2000 2001 2002 2003 2004 Lao PDR 1.5 1.5 1.5 1.4 1.6 East Asia and 3.2 3.5 3.7 3.7 3.6 Pacific Region Source: World Bank • As of December 2007, the Telecommunications revenue has increased dramatically and accounts for approximately 3% of GDP
  • 22. Impact of Liberalization on Economies • Liberalization of economies. Globalization, WTO negotiations on liberalization of basic telecommunication services, followed by privatization, competition and independent regulators have paved the way for rapid growth of ICT sector, so much so, that it is also anticipated while going forward that a major part of the GDP of the country would be contributed by the ICT sector.
  • 23. Relationship between ICTs and MDGs • For bridging the digital divide, it is imperative to put ICT firmly in the service of development. • Communication infrastructure, computer availability, Internet access and availability of alternative access, e.g. through cable, satellite and digital TVs and availability of content in the local language are basic issues. • The digital divide among households appears to mainly depend on two factors, viz. income and education. This fact also establishes a direct relationship between ICTs and MDGs that move us forward in reducing poverty or conversely increasing income and increasing education. • In fact, ICTs may be applied to all fields of human endeavour and management, to enrich the society through enhancement of capacities at all levels: individuals, organizations, governments, global partnerships.
  • 24. Global mobile entertainment revenues 45,000 Gambling 40,000 Adult TV 35,000 Video 30,000 Images US$ millions Music 25,000 Games 20,000 15,000 10,000 5,000 0 2006 2007 2008 2009 2010 2011 Source: Informa.
  • 25. IV. Market Structure and ownership
  • 26. Telecommunications/ICTs Market Telecom Operators/ISPs Ownership Enterprise Telecommunication Re-established in 2000 Lao (ETL) - 100% Government of Lao PDR Lao Telecommunication Established in 1996 Company (LTC) - 51% Government of Lao PDR - 49 % Shinawatra Int’l Co., Thailand Star Telecom Established in April 2008 - 51% GoL (through LAT which is 100% MoD) - 49% Viettel Global (Vietnam State owned operator) Millicom Lao Co. Ltd (Tigo) Established in 2003 - 22% Government of Lao PDR - 78% Millicom Int’l Cellular (Sweden) SKY Telecom Co., Ltd (SKY) Established in 2005 - 30% Government of Lao PDR - 70% Skytel & Net Co., Ltd, Thailand Planet Online Established in 1997 - Leading private ISP, Australian owned company
  • 27. Telecommunications/ICTs Market Telecom Operators/ISPs Technology/Services Enterprise Telecommunication - PSTN (Fixed line), GSM900/1800, GPRS, ISP Lao (ETL) - Dial up, ADSL, HIL, VPN Lao Telecommunication - PSTN (Fixed Line), GSM900/1800, CDMA (WLL),ISP Company (LTC) - 3G (WCDMA) service trial launched in July 2008 - Dial up, ADSL, IP Star Star Telecom - PSTN (Fixed Line) - GSM 900/1800 Millicom Lao Co. Ltd (Tigo) - GSM 900/1800, EDGE, WiMAX SKY Telecom Co., Ltd (SKY) - CDMA2000 1X at 800/1900, WCDMA, Internet - Voice services planned to launch late 2008 Planet Online - Broadband Wireless Internet @ 700 MHz - ISP
  • 28. Telecommunications/ICTs revenue MLL (10%) ETL LAT (25%) (2%) LTC (63%) Revenue Shares, 2007
  • 29. V. Global Trend
  • 30. ICT Growth Trend Growth in fixed lines, mobile & Internet, in billions, 1995-2006 6.0 5.0 4.0 3.0 2.0 1.0 0.0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Fixed lines Mobile phones Internet connections Source: ITU World Telecommunication/ICT Indicators Database
  • 31. Broadband Penetration Trend Source: digital. Life, ITU Internet Report 2006
  • 32. Competition: International Trend Competition is authorized in more than 60% of the countries in Basic and leased line services Competition is authorized in more than 80% of the countries in Broadband and Mobile services
  • 33. VI. Lao Telecommunications Sector Performance
  • 34. Fixed network growth 140,000 WLL 120,000 fixed lines 25538 100,000 18452 7915 10918 80,000 lines 60,000 90806 92151 94828 89661 40,000 67556 46897 20,000 33267 39235 0 2000 2001 2002 2003 2004 2005 2006 2007
  • 35. Mobile subscribers 1600000 1478409 1400000 1200000 1009565 1000000 800000 657528 600000 400000 337875 200000 89000 55200 5031 18000 0 2000 2001 2002 2003 2004 2005 2006 2007
  • 36. Mobile vs. Fixed 1600000 1400000 1200000 1000000 800000 600000 400000 200000 0 2000 2001 2002 2003 2004 2005 2006 2007 Mobile Fixed CDMA
  • 37. Internet access 4500 4000 3500 3000 2500 2000 1500 1000 500 0 2000 2001 2002 2003 2004 2005 2006 2007 Dail up ADSL Wireless
  • 38. Other Internet access 5000 4500 Wireless 4000 Leased lines HIL 3500 IPStar 3000 ADSL lines 2500 2000 1500 1000 500 0 2003 2004 2005 2006 2007
  • 39. Total number of Internet line 7000 6,624 6000 5,238 5000 4,271 4000 3000 2,538 2000 970 1000 620 350 460 0 2000 2001 2002 2003 2004 2005 2006 2007
  • 40. Telecommunications infrastructure • Backbone Optical Fiber Cables are interconnected with China, Thailand and Vietnam. • OFC to Cambodia and Myanmar have reached the borders • Optical fiber networks are connected to 15 provinces and expanding to cover 90% of districts • GSM networks are expanding to all districts
  • 41. Targets 2007-2010 July 2007 2008 2009 2010 2006 Lines 91,928 105,000 105,000 105,000 105,000 Fixed +12,674 % 1.8% 1.9% 1.9% 1.9% 1.9% 837,218 1,077,000 1,292,000 1,551,000 1,861,000 Mobile Lines % 14.9% 19.2% 23.0% 27.6% 33.2% 500 1,500 5,000 12,500 25,000 Broad Lines band % 0.01% 0.03% 0.10% 0.25% 0.50%
  • 42. VII. Challenges
  • 43. Regulatory issues • Need a clear and adequate Telecommunication/ICTs policy on – Licensing to new entrants – Infrastructure sharing – Interconnection – Radio Spectrum – Universal Access • Sector’s capacity-building
  • 44. Utilization of ICTs Infrastructure • ICTs infrastructure is well developed but not fully utilized – Lack of computer literacy – Lack of contents in local language – Limited availability of computers – High prices for connectivity and Internet access
  • 45. Conclusion • Recognizing the dominant role played by ICTs in globalization and in attaining the UNMDGs, the governments may seriously consider to create an enabling environment by putting in place suitable policy, regulatory and legal framework and fiscal incentives to encourage investment in ICT industry, network infrastructure keeping in mind the emerging new generation network and services, improve access to network for broadband services in rural areas by establishing Telecentres, Community Service centres, in the true spirit of the WSIS vision, principles and the plan of action. • The countries should recognize the contribution of ICTs for sustainable socio-economic development and in achieving MDGs and accelerate the sector reform process for attaining rapid growth through private sector participation with Regulator providing a level playing field, creating an investor friendly climate, safeguarding consumer interest, to usher in open market competition leading to better quality of service to end-users at lower cost.
  • 46. Thank you
  • 47. Summit Objectives By 2015 a) to connect all villages with ICTs b) to connect all educational institutions c) to connect all scientific and research centres; d) to connect all public libraries, museums and archives e) to connect all health centres and hospitals; f) to connect local and central government departments g) to adapt all primary and secondary school curricula to meet the challenges of the Information Society; h) to ensure that all have access to television and radio services; i) to encourage the development of content on the Internet; j) to ensure that more than half the world’s inhabitants have access to ICTs within their reach.

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